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Auto alternatives for the 21st centuryFri, 09 Dec 2016 14:15:34 +0000en-UShourly1http://wordpress.org/?v=4.2.4LG Chem Signs Massive Deal with World’s Largest Energy Storage Supply Companyhttp://www.hybridcars.com/lg-chem-signs-massive-deal-with-worlds-largest-energy-storage-supply-company/
http://www.hybridcars.com/lg-chem-signs-massive-deal-with-worlds-largest-energy-storage-supply-company/#commentsThu, 17 Dec 2015 17:09:27 +0000http://www.hybridcars.com/?p=380210On Wednesday LG Chem announced a battery supply deal with AES, the world’s largest Energy Storage Supply company. According to the agreement, the largest of its kind, LG Chem would supply approximately one gigawatt-hour worth of lithium-ion batteries to the Virginia-based company. To put that figure into perspective, one GWh of batteries could power more […]

According to the agreement, the largest of its kind, LG Chem would supply approximately one gigawatt-hour worth of lithium-ion batteries to the Virginia-based company. To put that figure into perspective, one GWh of batteries could power more than 90 million smartphones, or 100,000 households or 54,000 second-generation Chevrolet Volts.

According to the U.S. Department of energy, at 917 MWh,the battery capacity is greater than the total capacity of all energy storage systems now operating and including those which are being constructed.

The batteries however are not for cars, but for stationary energy storage units, but certainly the deal adds to LG Chem’s position as one of the world’s most influential battery companies.

“LG Chem has set a milestone with the latest supply deal for the gigawatt-class batteries,” said Lee Ung-beom, the head of LG Chem’s energy solution company.

Seoul-based LG Chem has been in the headlines recently, as it was announced in October that it would be the battery supplier for the upcoming Chevrolet Bolt EV. Chevy officials have stated that the Bolt, which is expected to go on sale by the end of 2016, will be able to travel 200 miles or more on a single charge. Whether or not LG Chem’s Holland, Mich. plant will be the source of production however has not been announced by GM.

The $303 million Holland plant, which opened in 2012, currently operates three battery lines that supply batteries for the 2016 Chevy Volt, along with the Chevy Spark EV and Cadillac ELR. A fourth line was scheduled to go online by the end of 2015.

Tesla Motors, which has stated goals for its own “Gigafactory” battery plant to open next year, announced in October an agreement with LG Chem that would have the Korean company provide batteries for existing Tesla Roadster battery upgrades. Rumors have suggested Tesla may wish to get batteries for other products from LG Chem in addition to existing agreements with Panasonic, but these have not been confirmed.

Beyond its agreement with AES, LG Chem has agreements in place with other energy companies around the world, to include Switzerland-based ABB, Japanese energy firm GPD, U.S.-based Duke Energy, and German firm STEAG.

]]>A U.S. Energy Department inspection of LG Chem’s still-under-construction battery plant in Holland, Mich. found trained, but idled workers were paid to play cards, board and video games – and LG Chem billed Uncle Sam $842,000 for tens of thousands of man hours for this.

Citing vagaries in the rules, and ultimately blaming the non productivity on the Volt – for which the plant is intended to produce battery cells – the Korean battery maker has however paid back the funds to the federal government.

According to a report by Wired, since the Volt’s battery cells are still made in Korea, and LG Chem has not shifted production stateside, it was felt these workers – whose numbers are estimated at “less than half” of 440 workers projected to eventually come on the payroll – had to do something to stay occupied while two of five planned production lines remain unfinished.

To date, not one battery cell has been produced in Holland for a production car offered for public sale, and they are all being made and shipped from Korea. In order to find something to do as they wait, other paid employees were found to be occupied with more civic-minded things like volunteering for Habitat for Humanity, outdoor nature centers, and animal shelters.

The story was portrayed as another (not-so) great example of your tax dollars (not) at work, and a government-mandated industry that has not exploded like the bureaucrats and industry executives working with them expected.

Building the new factory has taken $142 million out of a $151 million federal Recovery Act grant. LG Chem Michigan is partially staffed and ready to go, but producing very little except expenses for all the effort.

Officials for the Korean company, spending the U.S. taxpayer funds, justified the need to pay idle workers further with a rather weak excuse that they’d initially been “unfamiliar with the types of costs that were allowable” and were trying to keep an awkward situation under control.

“They wanted to do their best to maintain the workforce in hopes that production would start soon,” said Energy Department inspector General, Gregory Friedman, who explained to Wired the situation. “They also indicated that they resorted to furloughs and permitted employees to engage in non-productive activities to help ensure that their investment in training employees was not lost.”

LG Chem officials have argued they had no choice but to pay workers to play.

The rationale for paying trained workers to kill time while they waited for a plant start up was ultimately blamed on the Volt’s production not living up to its billing that had paved the way for this factory in the first place.

In calendar year 2012, noted Wired, GM sold around half of the 60,000 Volts and Amperas it had initially projected globally – back when plans for the LG Chem Michigan plant were also just getting underway.

Friedman told the publication that LG Chem had to make some tough decisions, but blamed lack of sufficient demand as lying “at the core of the problem.”

The government inspector also observed GM is nonetheless domestically producing on average 1,955 Volts each month, and these at least could use batteries produced in Holland.

But they are not.

So until “some alternative use for the plant is developed,” or LG Chem decides to move production from Korea to Michigan, Friedman told Wired, “U.S. taxpayers will receive little direct benefit from a plant for which they provided half the funding.”